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American History Lesson for Cyprus

As the Cypriots and their Russian friends perch on the edge of running the banks http://thedianerehmshow.org/shows/2013-03-21/cyprus-and-eu-b...
I think its time to take a step back and remember the calming words of the great American president Franklin Roosevelt and the deeds that followed those words.

WORDS:
Saturday, March 4, 1933 FDR assured the Cypriot--- Err-- American people not to fear the state of the economy with the famous line:
"let me assert my firm belief that the only thing we have to fear is...fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. "
http://en.wikipedia.org/wiki/First_inauguration_of_Franklin_...

31 days later...

DEEDS:
Tuesday, April 5, 1933, President Roosevelt gave the American people something real to fear. A presidential order to seize the gold of ordinary Americans. FDR issues Executive Order 6102 ordering all americans to deliver on or before May 1, 1933 all but a small amount of gold for a fixed exchange rate of $20.67. Later revalued at a loss of 40%
http://en.wikipedia.org/wiki/Executive_Order_6102



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Good point but recheck the math

The devaluation was 70% not 40 %. If you exchanged 20 dollars for an ounce of gold and then the government took it and gave you back your 20 dollars and then told you that you can now get your ounce of gold back but we will only exchange it for 35 dollars that is a 70% decrease in the purchasing power of the dollars. (Inflation……..that was the goal) This is really the reason so many hated FDR. A lot of New Deal Programs were stated under Hoover (can you say Hoover Dam…….which was renamed Boulder Dam by FDR). FDR was hated for stealing the wealth of “Savers”…….for the benefit of “Debtors”.

The math looks like this:
35-20.67= 14.33 14.33/35= 40%
35-20.67=14.33 14.33/20.67=70%
This is what Cyprus would do if they were on a gold standard and not fixed to the euro……well they would probably just do Quantitative Easing……..buy bonds with freshly printed fiat currency.

This is a great video. Have you ever seen it?

http://www.youtube.com/watch?v=LKsZ1hqHBHU&feature=related